The Consumer Financial Protection Bureau (CFPB) proposed a registry which would require certain nonbank financial institutions to register with the bureau when they become subject to federal, state, or local consumer financial protection agency or court orders brought under federal consumer financial protection laws or state laws regarding unfair, deceptive, or abusive acts or practices.
“Protecting American households is a shared effort across local, state, and federal authorities,” said CFPB Director Rohit Chopra in a release. “The proposed registry will help the CFPB, the law enforcement community, and the public limit the harms from repeat offenders.”
The proposed rule would also have the CFPB publishing the company information and orders via an online registry. Larger companies subject to the CFPB’s supervisory authority would also be required to designate an individual to submit an annual supervisory written statement attesting to whether the firm is adhering to registered law enforcement orders and any known violations of, or other instances of noncompliance with, the agency or court order.
“Because the issuance of agency and court orders serves as one of the most important tools to pursue lawbreakers in these markets, it is important that the CFPB maintain a central repository of nonbanks subject to agency and court orders,” the bureau stated. “The repository will allow the CFPB to track and mitigate the risks posed by repeat offenders, while also being able to monitor all lawbreakers subject to agency and court orders. The CFPB will share this powerful source of information with others, including with fellow regulators and law enforcement agencies, by making the registry public.”
The CFPB believes a registry will help unify the efforts of federal, state, and local consumer financial protection enforcers, as well as provide increased transparency and coordination to ensure accountability and fairness in the marketplace.
The CFPB, in the press releases accompanying the proposed rules announcement, noted that it is considering expanding this rule to include insured banks and credit unions.